We are moving to new hardware

12:00 CET – Board closed.
12:38 CET – Redirect in place; all requests for freegoldforum are now redirected to this maintenance page.
12:45 CET – Restore started
13:10 CET – Restore completed. Web server won’t start … suspected cause SElinux policy
13:15 CET – Problems fixed. Web server started. Testing results.
13:17 CET – Migration confirmed OK. Changing DNS records. The Time To Live (TTL) is 30 minutes, so in about an hour the board is available to most people.
13:23 CET – Mail functionality tested. Received-SPF: pass
13:30 CET – All completed, board opened.

How do I see the DNS records have changed for me? Can I speed things up?

- If you go to www.freegoldforum.com and you get redirected to this page, your DNS records are still pending change.
- Check this site, but if your provider’s DNS is not updated, this trick won’t be much help.

Update

The server was released to us today, but with incorrect operating system. We have to wait for the server to be released again, which will squeeze out the upgrade, and only leave the move to the new server. The downtime should be similar, but we have to schedule a later downtime window for the software upgrade. As the software upgrade is a minor maintenance release, there is no rush for it anyway.

Original message

We are moving in the morning of Wednesday 11 January 2012. There is one caveat: the hardware is not yet released to us, if not available in time we postpone the upgrade.

What are we announcing?

The site is going to move (again). The reason of last migration was to avoid being impacted by other machines sharing the same server. We moved from shared hosting to a Virtual Server. Unfortunately, we did see our virtual server being impacted due to a DDoS attack on other machines, sharing the same hardware through the physical host. In other words, the migration succeeded, but was not satisfactory: we have to move away even further. Now, we move to dedicated hardware, which in theory should eliminate the usual culprits: sharing disk, memory and CPU.

What do I have to do?

Nothing at all, perhaps being patient. The migration is taking place between servers, and you may experience this site to be read-only during the migration timeframe.

What will change?

We use the opportunity to upgrade to the latest version of the forum software, phpBB version 3.0.10. That is a maintenance release, mostly containing bug fixes. No new features will be introduced.

How can I follow the progress?

We will announce the progress on this page, so you can see what’s up.

Migration progress
9:00 CET – board closed (read-only)
9:30 CET – site copied, databases recreated
9:35 CET – DNS records update to point to the new server
9:40 CET – Bypassing DNS, everything checks out fine! Waiting for the DNS changes to propagate. Time to live is 1 hour, so in theory it should not take long. Unless you are unlucky, and your DNS server is chained, every server in the chain taking 1 hour. If there are 3 DNS servers in the chain (on average), the change is done by 12:00 CET.
9:50 CET – My own hoster’s DNS server is already up to date, and I can now browse the forum again!
10:30 CET – Some functions, like sending out emails, may not work yet. They require the receiving servers to resolve our new server – they have to rely on the same DNS change to propagate.
12:00 CET – Done.

What are we announcing?
The site is going to move. As you may have noticed, the performance is sometimes slow, mainly during the evening hours (19:00~22:00 CET). The reason is that the site is currently on shared hosting, the site really is sharing resources with hundreds of other sites. And if all sites are popular during that timeframe, the server is flooded with request, or is undersized to do the job. To address this, there is acquired a new dedicated server, so we don’t have to fight for resources anymore.

What do I have to do?
Nothing at all, perhaps being patient. The migration is taking place between servers, and you may experience this site to be read-only during the migration timeframe.

What will change?
Perhaps you noticed that the forum is currently redirected to be at freegoldcapital.com/forum. That will change. In the new situation, the forum can be reached at freegoldforum.com which will then automatically forward to www.freegoldforum.com

How can I follow the progress?
We will announce the progress on this page, so you can see what’s up.

Discuss this video at our forum, freegoldforum.com

Start of Transcript

This is a publication of Freegold Capital

Fg: High Everyone!

Today, we are talking to Koenraad Verheyden, a private gold investor for more then forty years.

He has been writing and posting on the internet’s about gold and freegold in particular. That free gold part got me curious, so it’s a real pleasure to talk to someone who appears to have been there from the beginning of freegold.

But before we start talking freegold, let’s go back to the moment you started. That’s more than forty years ago. That must have been straight at the end of the Bretton Woods system, and what’s triggered your interesting in gold back then?

Koen: Exactly! It was the turbulent Seventees, where we had the oil crsis. And … the closing of the gold window. by president Nixon. And, the debt crisis started escalating at that particular moment up until now. And that was the main reason why gold got my attention, and started to study it. And, to trading it, to buying it, holding it and accumulating it.

Fg: Okay. Which might not be that obvious to people -like me- who have not been in that timeframe. Can you describe that time to the audience? Has it been turbulent in a political sense, from a monetary perspective? Can you describe that to the audience?

Koen: It was a very, very, very turbulent period, on all aspects of life. Politically, socially, economically and financially. The Dollar, the almighty world Dollar came under pressure, simply because Nixon closed the gold window and the Dollar was not redeemable in gold anymore. So, all those who have been accumulating Dollar surpluses as a reserve, they have no right to redeem their Dollars for gold! And that was a unilateral decision taken, by the Dollar regime.

Fg: It was like a shockwave going through the the financial and monetary system?

Koen: Exactly!

Fg: Right. Which is actually quite hard to understand, for like people like me. We have simply seen, and grown-up in a very stable time, with almost no inflation or not visible inflation, and not so much political turbulence. So it was quite a different time back then.

Let’s move to the current day, because we just moved from a liquidity crisis back in 2007 and 2008, into a full blown sovereign debt crisis. Ho would you describe the economic situation we are in right now?

Koen: Well, I can synthesize it in four words: It is a “debt driven, political economy”. So the main driver of this economy is debt! No economy without an escalating debt, upon debt! And the economy is also politically driven! This is not a free market as we all imagine what a free-market exactly is. It is our politics and debt is politics! Economics are politics, politics are economics!

Fg: Right, so the usual phrase that we have a free market, and the free market is failing is, well, not something you would agree with?

Koen: There has actually, there has never been a free market! Doesn’t exist such a thing as a free market. All markets are governed. And politically governed.

Fg: Right. And I think that this quite right and even on a moderate level, there has been market manipulation from basically the beginning of the market places anyway. And how is the current situation different, then back when you started as a gold investor forty years ago?

Koen: In my opinion it escalated from bad, to worse. More politics, more debt, simply because it is a systemic affair. And it is not a cyclic, or an up or down matter, but systemic affair. So, today, we see the results of forty, fifty, sixty years, almost seven decades of mismanagement. More and more political economy. Less free markets, and further and further away from meritocracy principle. And that is also having an effect on our social life. People lose direction. Debt, the debt orgy is completely starting to control the western hemisphere. And we see the results today.

Fg: Right, you bring up a particular word “meritocracy”, and especially related to debt. Because I think what you’re saying is that debt is basically distorting the economic behavior and economic function of our society. Can you elaborate a little bit on meritocracy, how debt is impacted?

Koen: Yes. There is nothing wrong in fact with debt, as long as it is productive debt. But if unproductive debt starts to domino it, the whole economy in the western hemisphere, we see that meritocracy is going down. Just think about subsidies, about particular groups who can exploits the unproductive debt formation for their own profits. The financial industry’s debt grows so big, so enormously astronomical big, that it is completely dominating the physical economy in the entire world. And normally it should be vice versa. You have a healthy economy, a physical economy, and you have a serving financial industry. So, basically we have an upside down world.

Fg: Right.

Koen: Yes.

Fg: OK. Because you mentioned good debt, that also implies there is bad debt. If I were to describe good debt, then I am thinking about for instance: When we had the colonization of the United States, you could provide loans to the new colony. And with that money, the people over there were building farms, and making themselves productive. Creating goods, selling them abroad, and actually paying off their debt. And starting to generate a revenue. I think that this definition of good debt.

Koen: Exactly.

Fg: So, then we are basically being run today by bad debt.

Koen: Yes.

Fg: OK, and if I were to give an example, then I’m thinking about the evarage person taking on a loan to pay off a holiday. And that is of course a complete waste of money because you’re not producing anything with that debt, or with that loan. You are simply destroying the value of it.

Koen: Yes. Yes, and since debt is money and money is debt. And, when unproductive debt is bad, so you have fake money.

Fg: Right. So begin to see the mismatch between our debt driven world, which is our money, and the real economy.

So, moving on, because most people unfamiliar with gold investing, would describe hard core gold investors as “gold bugs”. People who advocate hard money, and who like to return to a gold standard. But you are not one of those people who like to return to a gold standard, but want to return to something else called freegold. Can you describe that to our listeners?

Koen: Yes. The old gold standard was a fixed price, goldprice standard. With emphasis on a “fixed price”. Today, 42 Dollars an ounce. Now, That fixed Dollar gold price standard failed totally. That is why Nixon had to close the gold window. Because, there was too much mismanagement in the financial monetary affairs, that Dollar debt became so astronomical, that no Dollars were redeemable in physical gold any more. So, America just to had to stop exchanging Dollars for physical gold.

Now, today, that fixed gold price standard still exist, but under another form. The gold price is being manipulated -frozen if you wish-, by those who prefer, still having a Dollar as good or even better as gold. Of course this is ridiculous! You can never be as good or even better then gold. Certainly when your fiat currency is debt-laden like hell. So, that is why people came up with: “how can we changed that gold standard”? That old Dollar gold price, fixed gold prices standard. And people like Rueff, who was serving under General de Gaulle, of France, got the idea, why don’t we let the gold price “float” freely, or governed freely? Well, that was a very difficult proposition idea, for the Dollar regime to swallow. How could it ever be possible that gold would be better then the world Dollar reserve? They just couldn’t imagined it. Today, it’s different. They will have to accept it one day, because the gold price is floating more and more and more freely. And that is a free floating gold wealth standard. You’re wealth is accumulated in physical gold, that is keeping up it’s value, it’s buying power forever! And that’s not the case with the Dollar! So, gold is slowly but surely proving to the entire world it IS better then the Dollar. That is in two words the story what happened from 1971 up until now and still evolving.

Fg: Ok, so the freegold is basically an environments where gold is allowed to float against any currency.

Koen: Yes.

FG: You mentioned that the gold price today is being managed, and then I have to assume that it’s managed by those who benefit most from a Dollar standard, Dollar reserve. And that is the US government.

Koen: Yes.

Fg: Or is it perhaps the US banks or the international banks?

Koen: No, it the Dollar system, which is governed by the Dollar regime. And the Dollar is the world’s … The world is on the Dollar standard. Each and every one who wants to buy a barrel of oil, or any commodity, must trade that in Dollars. So, basically everybody is a kind of Dollar slave. Now, if you want your currency to be on top of the world, you don’t want any competitor to say, “Hey, you are simply a unit of account, that is 100% debt.” And who is there to say such a thing like that? That is a piece of gold metal! Because, gold is no-ones debt. And on the other side, the Dollar is the center if the world. And all the other currencies in the world, are floating around the dollar standard. And, we have floating currencies. But, why don’t we have a floating gold price? Why must the gold price be governed, for exactly the reason that you mentioned in your question. It serves the Dollar system, which is a Dollar monopoly on the world, and the regime behind that Dollar system.

Fg: Right. So, if we were to the zoom in on freegold. You mentioned that we are going to save in physical gold. But, there has to be some severe implications out of that. Especially, looking around our monetary system, how we use money today. So, are we still using our Euro’s in our wallet to pay? How will we use the money then?

Koen: Of course, these are modern times! We still keep using currency, any currencies. A currency is a unit of account. And you settle any business in a unit of account, whatever currency. But, the currency, those currencies, are not a the store of wealth anymore. Simply because they are equal to debt, and debt is not the store of wealth. So, what the world needs now is an appropriate store of wealth. One that already exists more than six thousand years. And the only one, is still the same: that’s the yellow metal!

Fg: OK. I think you excellent described that so our currency …, well, our currency is based on debt, which is not the store of value by definition almost. Because, if we borough money into existence, we have to pay interest on top of that. Which means it [the debt] will always increase in amount. And will always decreasing in value overtime.

Koen: Exactly.

Fg: OK, So if we were to use a surplus of currency to convert into gold, as a form of savings. That will also greatly impact for instance our … well, like the available capital to banks. So, I can only imagine that there are no deposit or savings accounts at banks any more. So that has some serious implications to the banking, banking industry doesn’t it?

Koen: No. Because for settling business we always do this in currencies. We are modern times, and this is not, never going to change. But, gold can also have not only a function of storing wealth, but also a discipline, disciplinating function on those who are governing the financial and monetary system. I’ll explain: Today, there are even suggestions that commercial banks should have in their reserves gold, gold metal. Simply because if clients decide they don’t want to save in currencies anymore, they can ask for physical gold. And commercial banks are obliged to deliver, and trade, physical gold to their clients. So what is this client doing with this bank? He is just saying: “Hi, I don’t trust your governance anymore. You’re doing the wrong things and have a wrong policy. I put my trust backed into gold! Just give me, sell me the gold. I exchange my currency for gold. And once I do trust you again, and you are proving that you are having good governance, oh, I might as well sell my gold and change it back into digits. Currency digits.” That is a discipline function that goes with gold.

Fg: OK. But, if there is anything, then there is a lack of discipline right now. So, I think then that at least we can see some changes to the amounts of the real capital being stored at the bank. Or, isn’t it?

Koen: The point is that banks, commercial banks and investment banks, are working with a fractional reserve system. And, that fraction of reserves, has become so thin, so immensely thin, that whatever happens, an accident -a debt accident of course-, those banks do fail because they don’t have reserves. Now, how simple would it be to have a bank, that is by law obliged to hold physical gold as a reserve. Just like the new European Central Bank is doing? And, the gold price, is allowed to float freely, and keeping up with the production of debt. And gold as a store of wealth, always keeps its buying power, whatever the debt amount or rise is. So, the bank always has a reliable and liquid reserve to trust on, and to use in times of stress. And that is physcial gold. That’s very feasible, easy, it is very easy to check and control. So, gold again is here a discipline, disciplining commercial banks not to leverage, and going to high risk maneuvers by fractional reserve banking.

Fg: Right, Circling back to something you mentioned and that is gold being redeemable. That might be a situation in Belgium, but I am not aware of any obligation here in The Netherlands, of banks having to redeem your deposits in gold. So that might be some unique situation for the Belgium banking system.

Going further. So if we moved to a freegold environment, how would it impact how banks or countries deal with each other like paying off the international balance of trade? Could you describe how that would be different then today?

Koen: A very good question. There will be no gold exchange standard anymore, because free floating gold, or freegold as we call it, is disciplining the governance. So, why should one country, that has a deficit with another, fill this up with the exchange of gold? No. Those countries, who don’t have gold, and can’t rely on a gold reserve, a free-floating one, they will remain poor. Just like countries who don’t have oil, or commodities in their soil. So, they have to get their wealth from another activity unfortunately. So they will have to buy gold elsewhere, with surpluses that they earn.

Fg: OK. So, you see then that there will be some movement of gold but basically to get their … economy growing, and to start exporting goods. That’s not that much as a settling of the balance of trade then?

Koen: No, no, Those who don’t have oil, they have to earn Dollars with export. And with these Dollars they buy oil. Those who want to become rich, and add to their reserves, and want to buy gold from another state, they have to work for it. And pay it in a reliable currency to the other state, who has more then enough gold reserves. Because, they are doing fine.

Fg: Right, So, going back to the current crisis. We hardly hear anyone actually talking about a solution. But sometimes we hear politicians mentioning -the IMF is one of them- about Special Drawing Rights, or SDR’s, as a solution. And they describe the SDR’s as basis for an international alternative monetary system. Would you agree to that, that the SDR is a solution, or do you think that freegold is a better alternative?

Koen: No, the SDR is a complete failure. It is not a solution at all, and it never was. It is simply a synthetic currency, and it’s worthless. It’s without any discipline, just like any other currency on its own. Be it a basket, or another basket. So, the SDR is completely worthless. And, it just sits there doing nothing.

Fg: Right, the SDR ultimately is just another form of debt, isn’t it?

Koen: Yes.

Fg: Right. OK, so if we move to a freegold system then, the current debt problems are not going away. They are not going to disappear by themselves, are they? I mean, how is that going to play out in your opinion?

Koen: Unfortunately, all this astronomical debt is never going to go away. We only need some collateral to back it up. And, today we are just doing our utmost best to keep that astronomical debt liquid. Now, that liquidity is no problem because we can print any digit in any amounts, we just like or need. I refer to Greenspan, who said it on CNBC explicitly. Now, the gold, free-floating gold can one day, and will surely, in my very opinion, … modest opinion, it will serve as collateral. Just to back up that astronomical debt. It will serve as a floor, that goes up in tandem with the increase of debt, the debt orgy. And those, who are without gold. will be left out. If they don’t start working and can get their hands on physical gold, They will be dropouts. Just like Greece today.

Fg: Right, so they will literally drown in their debt. There is no floor for them to get hold on. And to put the feet on the ground.

Koen: Right.

Fg: OK. So, in other words you still see quite a disaster on the road ahead. That’s something we have to deal with first?

Koen: I think so, we’re going straight to disaster. Because, the astronomical debt has lost all credibility. And in order to give all these debts some credibility again, there must come an external factor in it, and that is again, and again “gold”. You can’t become or remain credible without having physical gold in your possession. Impossible! Because your money, your currency, your unproductive political economy, is a debt driven [one]. So, without gold, you cannot keep up this system. And just make gold a tier-one reserve collateral, a store of wealth, and a reserve. And everything is solved. So, stop making a problem from gold. It is not a Dollar competitor, it is just an extinguisher of debt. Make gold a solution, not a problem.

Fg: Right. And, if debt is the problem, underlaying our crisis, then most likely those who borrowed most, will have to the impacted most. And so would you say that this problem is more of a Western world, and not so much for Asia, or the upcoming economic powers, or even African is coming to mind, because some countries even have no money. Or, people don’t have any money.

Koen: No, we are all in the same boat, East and West. Just think that the East, the surplus producing countries, have approximately seven to eight trillion Dollars in US treasury reserves. So, what is stored in their central bank as a reserve, is one hundred percent dollar Debt. So what they are doing now is trying to get as much physical gold as they can get. They can’t buy it in the open market, because it is not available. And if they should start buying it in the open market, the gold price would immediately explode to unbelievable levels. So what they are doing, China, Russia, and all the other small countries, who do have gold in their soil, between, inside their territory, they start digging for gold. They don’t sell it, they don’t export it. They just store it in their central banks, and try to get as much gold as possible, from other countries: Africa, South America, Canada. But, slowly but surely, these country start to realize that something is going on with this gold thing, that remained under the radar, for the past 20 or 30 years. And, they are getting suspicious, and they want to keep their gold. But they are so extremely poor … economic thing … mean nothing economically. So they have to sell what they have. And they are selling most of the time very precious things to those countries who succeeded in produce surpluses.

Fg: Right, yeah, I see. And if we were about to see a timeline of all this debt problem being played out? Someone or some did say that it would actually end straight at the end of the Bretton Woods system. But, yet again, we are here 40 years later. What time horizon do you see a structural solution coming?

Koen: This is really a tough one. No, honestly, I would give a diplomatic answer. Sooner rather then later. But no, I can’t pinpoint any timing on that.

Fg: Fair enough, but would you say we can keep going for another 40 years?

Koen: No, no, definitely not. No.

Fg: OK.

Koen: No.

Fg: Very good.

Going back to the origins of freegold. How did it came into existence? I mean: It is a very good system, so why hasn’t it been used before? Or why are aren’t we using it today?

Koen: Yes, that is a good question. The past 50 years, people, the ones on top of financial monetary governance, they really, really had that big problem with gold, a fixed Dollar gold standard, or free-floating gold. They never really got out of it. And I referred to France’s De Gaulle and his chief Jacques Rueff. Those people realized that the Dollar system and the Dollar regime, had an enormous privilege of having their Dollar being the world’s reserve, without gold playing a significant disciplining role anymore. Now, the reason, or the way the Dollar system and regime could govern, manipulate freeze of the gold price, by not letting it float freely, is that they invented the gold contract market. So, we went from a physical gold market where you entered into a bank, gave a note, and received a piece of gold metal in physical form. So that paper gold contract market was build just to freeze, to control, to manipulate the gold price. So that its main competitor, the Dollar, remain “King of the Road”. Now, it is very difficult to change seven decades and even more, -it’s almost a one hundred years. Remembered, just remember that the Federal Reserve was erected in 1913, so that’s allmost 100 years- it is very difficult to change gradually, or suddenly, or abruptly from a fixed gold price standard, to a free floating gold standard. It has to go gradually. And that is exactly what the European Central Bank wants to do. By marking to market it’s gold reserve on the free floating gold price of the day. Take it gradually, they don’t force the Dollar to abdicate, and to make place for gold reserve. Because that would be so shocking, that all the world global economical financial monetary balances, would be rocked like hell. And that’s not the purpose. We just have to go it gradually. How much time it will take, I don’t know. But we already started in 1999, by the birth of the Euro, gold started to rise on an average of 17% a year. That’s a very, very nice thing for those who are having all their savings in gold.

Fg: Absolutely. So, you mentioned a very important thing I think. So, freegold or free-floating gold, is basically used by those central banks, who mark their gold reserves to market value on a regular basis. Which is obviously the European Central Bank, and as I understand, also the upcoming BRIC countries. But it’s not the USA, or the treasury of the USA. In that respect, how do you see it playing out then with the Dollar? Because, I think those who control the Dollar and their reserve status, most likely want to extend that privilege as long as possible. Do you see the Dollar actually moving to something like freegold in the end as well?

Koen: That is a very tough one. Yes, they will have to. Because, at the moment they are still the only one, the only one who is not having gold in their central bank as a reserve asset. The US gold is by the US treasury, not in the Federal Reserve. So, as long as the Dollar thinks that he can rule the world, he will make no move or what so ever to free floating gold. And that is OK with the rest of the world, they don’t want to force the Dollar regime or the Dollar system into a free floating gold reserve. They just do it on their own, step by step. The Chinese, the Russians, the Saoudi’s, Europe, even Mexico, or South America. The states who do have a lot of gold in their ground ground, like Canada or Australia, they don’t have to put gold on their central bank reserves, their wealth just sits beneath them underground. So, your question, when is America going to shift to freegold, or free floating gold? Uhm, hahaha, I am inclined to answer: they will never do. But, we don’t know how things will change in the world. Will there ever be a war between America and China? Will China take over world dominance? These are really questions I can’t answer today.

Fg: Right, of course. But I am just curious to find out, if America is not going to accept a discipline on their growth or their debt growth, then do you see, like hyperinflation in the Dollar, being experienced in the in future?

Koen: Yes. America is never, never, never going to accept any discipline or monetary financial orthedoxy as we see here in Europe. On the contrary. They are going to force the entire world to be as undisciplined as they are. Just because they are the biggest one, they are the leader, they are the mightiest one. They want, still want to impose their Dollar on the entire world. Now, if this is going to change one day, they will try to make a Bretton Woods like agreement, where they keep all their leverages on their side. All the power, the controlling power under the Dollar system and regime. But, the world has changed. And now, the world is not ruled anymore by a dominant US and a following Euroland. Now we have China and the East. The Asians are an upcoming power. And America will have it very difficult to keep Euroland as a partner, as a transatlantic partner. I see Euroland shifting to the East. And then America will have a very difficult time coming, which already is here. And I see that increasing. And we don’t know how they are going to react. Once they realize they start getting out of power, out of control. We don’t know what will happen will. World War 3, I don’t know.

Fg: One thing for sure: interesting times are ahead.

Koen: Exactly.

Fg: Right. So, wrapping up. How did you learn about freegold or freegold as a concept?

Koen: Well, that was mainly by accident. Just on the internet, world wide web, and is covered in “The Gold Trail“. The gold trail still on the web, and that’s just two persons are not named, who named themselves “Another”, and “Friend of Another” and they produced two hundred pages of freegold theory. And a question and answers and freegold was born. The idea was born. It is such a fascinating story, that I can advise that everyone should read it. Read “Gold Trail“, as simple as that.

Fg: I can only concur. It’s a very interesting story. Especially as it was written I belief in 1998. So quite a while ago.

Koen: Yes, yes.

Fg: Yes indeed.

So, thank you very much sir, for for talking to us. It has been a real pleasure.

Koen: The pleasure was mine, sir.

Freegold Capital: For more information, please visit freegoldcapital.com or discuss this interview, freegold and all of its aspects at freegoldforum.com

End of Transcript

Discuss this video at our forum, freegoldforum.com

Be sure to check back for more interviews with freegold specialist like Ivo Cerckel, and other financial and monetary experts!

Earlier released part 1, part 2 and part 3 of this video.

Start of Transcript Part 4

Fg: Going back to the origins of freegold. How did it came into existence? I mean: It is a very good system, so why hasn’t it been used before? Or why are aren’t we using it today?

Koen: Yes, that is a good question. The past 50 years, people, the ones on top of financial monetary governance, they really, really had that big problem with gold, a fixed Dollar gold standard, or free-floating gold. They never really got out of it. And I referred to France’s De Gaulle and his chief Jacques Rueff. Those people realized that the Dollar system and the Dollar regime, had an enormous privilege of having their Dollar being the world’s reserve, without gold playing a significant disciplining role anymore. Now, the reason, or the way the Dollar system and regime could govern, manipulate freeze of the gold price, by not letting it float freely, is that they invented the gold contract market. So, we went from a physical gold market where you entered into a bank, gave a note, and received a piece of gold metal in physical form. So that paper gold contract market was build just to freeze, to control, to manipulate the gold price. So that its main competitor, the Dollar, remain “King of the Road”. Now, it is very difficult to change seven decades and even more, -it’s almost a one hundred years. Remembered, just remember that the Federal Reserve was erected in 1913, so that’s allmost 100 years- it is very difficult to change gradually, or suddenly, or abruptly from a fixed gold price standard, to a free floating gold standard. It has to go gradually. And that is exactly what the European Central Bank wants to do. By marking to market it’s gold reserve on the free floating gold price of the day. Take it gradually, they don’t force the Dollar to abdicate, and to make place for gold reserve. Because that would be so shocking, that all the world global economical financial monetary balances, would be rocked like hell. And that’s not the purpose. We just have to go it gradually. How much time it will take, I don’t know. But we already started in 1999, by the birth of the Euro, gold started to rise on an average of 17% a year. That’s a very, very nice thing for those who are having all their savings in gold.

Fg: Absolutely. So, you mentioned a very important thing I think. So, freegold or free-floating gold, is basically used by those central banks, who mark their gold reserves to market value on a regular basis. Which is obviously the European Central Bank, and as I understand, also the upcoming BRIC countries. But it’s not the USA, or the treasury of the USA. In that respect, how do you see it playing out then with the Dollar? Because, I think those who control the Dollar and their reserve status, most likely want to extend that privilege as long as possible. Do you see the Dollar actually moving to something like freegold in the end as well?

Koen: That is a very tough one. Yes, they will have to. Because, at the moment they are still the only one, the only one who is not having gold in their central bank as a reserve asset. The US gold is by the US treasury, not in the Federal Reserve. So, as long as the Dollar thinks that he can rule the world, he will make no move or what so ever to free floating gold. And that is OK with the rest of the world, they don’t want to force the Dollar regime or the Dollar system into a free floating gold reserve. They just do it on their own, step by step. The Chinese, the Russians, the Saoudi’s, Europe, even Mexico, or South America. The states who do have a lot of gold in their ground ground, like Canada or Australia, they don’t have to put gold on their central bank reserves, their wealth just sits beneath them underground. So, your question, when is America going to shift to freegold, or free floating gold? Uhm, hahaha, I am inclined to answer: they will never do. But, we don’t know how things will change in the world. Will there ever be a war between America and China? Will China take over world dominance? These are really questions I can’t answer today.

Fg: Right, of course. But I am just curious to find out, if America is not going to accept a discipline on their growth or their debt growth, then do you see, like hyperinflation in the Dollar, being experienced in the in future?

Koen: Yes. America is never, never, never going to accept any discipline or monetary financial orthedoxy as we see here in Europe. On the contrary. They are going to force the entire world to be as undisciplined as they are. Just because they are the biggest one, they are the leader, they are the mightiest one. They want, still want to impose their Dollar on the entire world. Now, if this is going to change one day, they will try to make a Bretton Woods like agreement, where they keep all their leverages on their side. All the power, the controlling power under the Dollar system and regime. But, the world has changed. And now, the world is not ruled anymore by a dominant US and a following Euroland. Now we have China and the East. The Asians are an upcoming power. And America will have it very difficult to keep Euroland as a partner, as a transatlantic partner. I see Euroland shifting to the East. And then America will have a very difficult time coming, which already is here. And I see that increasing. And we don’t know how they are going to react. Once they realize they start getting out of power, out of control. We don’t know what will happen will. World War 3, I don’t know.

Fg: One thing for sure: interesting times are ahead.

Koen: Exactly.

Fg: Right. So, wrapping up. How did you learn about freegold or freegold as a concept?

Koen: Well, that was mainly by accident. Just on the internet, world wide web, and is covered in “The Gold Trail“. The gold trail still on the web, and that’s just two persons are not named, who named themselves “Another”, and “Friend of Another” and they produced two hundred pages of freegold theory. And a question and answers and freegold was born. The idea was born. It is such a fascinating story, that I can advise that everyone should read it. Read “Gold Trail“, as simple as that.

Fg: I can only concur. It’s a very interesting story. Especially as it was written I belief in 1998. So quite a while ago.

Koen: Yes, yes.

Fg: Yes indeed.

So, thank you very much sir, for for talking to us. It has been a real pleasure.

Koen: The pleasure was mine, sir.

Freegold Capital: For more information, please visit freegoldcapital.com or discuss this interview, freegold and all of its aspects at freegoldforum.com

End of Transcript Part 4

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Be sure to check in Sunday night (Central European Time), when we will be releasing part 4 of this interview!

Earlier released part 1 and part 2 of this video.

Start of Transcript Part 3

Fg: Right, Circling back to something you mentioned and that is gold being redeemable. That might be a situation in Belgium, but I am not aware of any obligation here in The Netherlands, of banks having to redeem your deposits in gold. So that might be some unique situation for the Belgium banking system.

Going further. So if we moved to a freegold environment, how would it impact how banks or countries deal with each other like paying off the international balance of trade? Could you describe how that would be different then today?

Koen: A very good question. There will be no gold exchange standard anymore, because free floating gold, or freegold as we call it, is disciplining the governance. So, why should one country, that has a deficit with another, fill this up with the exchange of gold? No. Those countries, who don’t have gold, and can’t rely on a gold reserve, a free-floating one, they will remain poor. Just like countries who don’t have oil, or commodities in their soil. So, they have to get their wealth from another activity unfortunately. So they will have to buy gold elsewhere, with surpluses that they earn.

Fg: OK. So, you see then that there will be some movement of gold but basically to get their … economy growing, and to start exporting goods. That’s not that much as a settling of the balance of trade then?

Koen: No, no, Those who don’t have oil, they have to earn Dollars with export. And with these Dollars they buy oil. Those who want to become rich, and add to their reserves, and want to buy gold from another state, they have to work for it. And pay it in a reliable currency to the other state, who has more then enough gold reserves. Because, they are doing fine.

Fg: Right, So, going back to the current crisis. We hardly hear anyone actually talking about a solution. But sometimes we hear politicians mentioning -the IMF is one of them- about Special Drawing Rights, or SDR’s, as a solution. And they describe the SDR’s as basis for an international alternative monetary system. Would you agree to that, that the SDR is a solution, or do you think that freegold is a better alternative?

Koen: No, the SDR is a complete failure. It is not a solution at all, and it never was. It is simply a synthetic currency, and it’s worthless. It’s without any discipline, just like any other currency on its own. Be it a basket, or another basket. So, the SDR is completely worthless. And, it just sits there doing nothing.

Fg: Right, the SDR ultimately is just another form of debt, isn’t it?

Koen: Yes.

Fg: Right. OK, so if we move to a freegold system then, the current debt problems are not going away. They are not going to disappear by themselves, are they? I mean, how is that going to play out in your opinion?

Koen: Unfortunately, all this astronomical debt is never going to go away. We only need some collateral to back it up. And, today we are just doing our utmost best to keep that astronomical debt liquid. Now, that liquidity is no problem because we can print any digit in any amounts, we just like or need. I refer to Greenspan, who said it on CNBC explicitly. Now, the gold, free-floating gold can one day, and will surely, in my very opinion, … modest opinion, it will serve as collateral. Just to back up that astronomical debt. It will serve as a floor, that goes up in tandem with the increase of debt, the debt orgy. And those, who are without gold. will be left out. If they don’t start working and can get their hands on physical gold, They will be dropouts. Just like Greece today.

Fg: Right, so they will literally drown in their debt. There is no floor for them to get hold on. And to put the feet on the ground.

Koen: Right.

Fg: OK. So, in other words you still see quite a disaster on the road ahead. That’s something we have to deal with first?

Koen: I think so, we’re going straight to disaster. Because, the astronomical debt has lost all credibility. And in order to give all these debts some credibility again, there must come an external factor in it, and that is again, and again “gold”. You can’t become or remain credible without having physical gold in your possession. Impossible! Because your money, your currency, your unproductive political economy, is a debt driven [one]. So, without gold, you cannot keep up this system. And just make gold a tier-one reserve collateral, a store of wealth, and a reserve. And everything is solved. So, stop making a problem from gold. It is not a Dollar competitor, it is just an extinguisher of debt. Make gold a solution, not a problem.

Fg: Right. And, if debt is the problem, underlaying our crisis, then most likely those who borrowed most, will have to the impacted most. And so would you say that this problem is more of a Western world, and not so much for Asia, or the upcoming economic powers, or even African is coming to mind, because some countries even have no money. Or, people don’t have any money.

Koen: No, we are all in the same boat, East and West. Just think that the East, the surplus producing countries, have approximately seven to eight trillion Dollars in US treasury reserves. So, what is stored in their central bank as a reserve, is one hundred percent dollar Debt. So what they are doing now is trying to get as much physical gold as they can get. They can’t buy it in the open market, because it is not available. And if they should start buying it in the open market, the gold price would immediately explode to unbelievable levels. So what they are doing, China, Russia, and all the other small countries, who do have gold in their soil, between, inside their territory, they start digging for gold. They don’t sell it, they don’t export it. They just store it in their central banks, and try to get as much gold as possible, from other countries: Africa, South America, Canada. But, slowly but surely, these country start to realize that something is going on with this gold thing, that remained under the radar, for the past 20 or 30 years. And, they are getting suspicious, and they want to keep their gold. But they are so extremely poor … economic thing … mean nothing economically. So they have to sell what they have. And they are selling most of the time very precious things to those countries who succeeded in produce surpluses.

Fg: Right, yeah, I see. And if we were about to see a timeline of all this debt problem being played out? Someone or some did say that it would actually end straight at the end of the Bretton Woods system. But, yet again, we are here 40 years later. What time horizon do you see a structural solution coming?

Koen: This is really a tough one. No, honestly, I would give a diplomatic answer. Sooner rather then later. But no, I can’t pinpoint any timing on that.

Fg: Fair enough, but would you say we can keep going for another 40 years?

Koen: No, no, definitely not. No.

Fg: OK.

Koen: No.

Fg: Very good.

End of Transcript Part 3

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Start of Transcript Part 2

Now, today, that fixed gold price standard still exist, but under another form. The gold price is being manipulated -frozen if you wish-, by those who prefer, still having a Dollar as good or even better as gold. Of course this is ridiculous! You can never be as good or even better then gold. Certainly when your fiat currency is debt-laden like hell. So, that is why people came up with: “how can we changed that gold standard”? That old Dollar gold price, fixed gold prices standard. And people like Rueff, who was serving under General de Gaulle, of France, got the idea, why don’t we let the gold price “float” freely, or governed freely? Well, that was a very difficult proposition idea, for the Dollar regime to swallow. How could it ever be possible that gold would be better then the world Dollar reserve? They just couldn’t imagined it. Today, it’s different. They will have to accept it one day, because the gold price is floating more and more and more freely. And that is a free floating gold wealth standard. You’re wealth is accumulated in physical gold, that is keeping up it’s value, it’s buying power forever! And that’s not the case with the Dollar! So, gold is slowly but surely proving to the entire world it IS better then the Dollar. That is in two words the story what happened from 1971 up until now and still evolving.

Fg: Ok, so the freegold is basically an environments where gold is allowed to float against any currency.

Koen: Yes.

FG: You mentioned that the gold price today is being managed, and then I have to assume that it’s managed by those who benefit most from a Dollar standard, Dollar reserve. And that is the US government.

Koen: Yes.

Fg: Or is it perhaps the US banks or the international banks?

Koen: No, it the Dollar system, which is governed by the Dollar regime. And the Dollar is the world’s … The world is on the Dollar standard. Each and every one who wants to buy a barrel of oil, or any commodity, must trade that in Dollars. So, basically everybody is a kind of Dollar slave. Now, if you want your currency to be on top of the world, you don’t want any competitor to say, “Hey, you are simply a unit of account, that is 100% debt.” And who is there to say such a thing like that? That is a piece of gold metal! Because, gold is no-ones debt. And on the other side, the Dollar is the center if the world. And all the other currencies in the world, are floating around the dollar standard. And, we have floating currencies. But, why don’t we have a floating gold price? Why must the gold price be governed, for exactly the reason that you mentioned in your question. It serves the Dollar system, which is a Dollar monopoly on the world, and the regime behind that Dollar system.

Fg: Right. So, if we were to the zoom in on freegold. You mentioned that we are going to save in physical gold. But, there has to be some severe implications out of that. Especially, looking around our monetary system, how we use money today. So, are we still using our Euro’s in our wallet to pay? How will we use the money then?

Koen: Of course, these are modern times! We still keep using currency, any currencies. A currency is a unit of account. And you settle any business in a unit of account, whatever currency. But, the currency, those currencies, are not a the store of wealth anymore. Simply because they are equal to debt, and debt is not the store of wealth. So, what the world needs now is an appropriate store of wealth. One that already exists more than six thousand years. And the only one, is still the same: that’s the yellow metal!

Fg: OK. I think you excellent described that so our currency …, well, our currency is based on debt, which is not the store of value by definition almost. Because, if we borough money into existence, we have to pay interest on top of that. Which means it [the debt] will always increase in amount. And will always decreasing in value overtime.

Koen: Exactly.

Fg: OK, So if we were to use a surplus of currency to convert into gold, as a form of savings. That will also greatly impact for instance our … well, like the available capital to banks. So, I can only imagine that there are no deposit or savings accounts at banks any more. So that has some serious implications to the banking, banking industry doesn’t it?

Koen: No. Because for settling business we always do this in currencies. We are modern times, and this is not, never going to change. But, gold can also have not only a function of storing wealth, but also a discipline, disciplinating function on those who are governing the financial and monetary system. I’ll explain: Today, there are even suggestions that commercial banks should have in their reserves gold, gold metal. Simply because if clients decide they don’t want to save in currencies anymore, they can ask for physical gold. And commercial banks are obliged to deliver, and trade, physical gold to their clients. So what is this client doing with this bank? He is just saying: “Hi, I don’t trust your governance anymore. You’re doing the wrong things and have a wrong policy. I put my trust backed into gold! Just give me, sell me the gold. I exchange my currency for gold. And once I do trust you again, and you are proving that you are having good governance, oh, I might as well sell my gold and change it back into digits. Currency digits.” That is a discipline function that goes with gold.

Fg: OK. But, if there is anything, then there is a lack of discipline right now. So, I think then that at least we can see some changes to the amounts of the real capital being stored at the bank. Or, isn’t it?

Koen: The point is that banks, commercial banks and investment banks, are working with a fractional reserve system. And, that fraction of reserves, has become so thin, so immensely thin, that whatever happens, an accident -a debt accident of course-, those banks do fail because they don’t have reserves. Now, how simple would it be to have a bank, that is by law obliged to hold physical gold as a reserve. Just like the new European Central Bank is doing? And, the gold price, is allowed to float freely, and keeping up with the production of debt. And gold as a store of wealth, always keeps its buying power, whatever the debt amount or rise is. So, the bank always has a reliable and liquid reserve to trust on, and to use in times of stress. And that is physcial gold. That’s very feasible, easy, it is very easy to check and control. So, gold again is here a discipline, disciplining commercial banks not to leverage, and going to high risk maneuvers by fractional reserve banking.

End of Transcript Part 2

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Start of Transcript Part 1

This is a publication of Freegold Capital

Fg: High Everyone!

Today, we are talking to Koenraad Verheyden, a private gold investor for more then forty years.

He has been writing and posting on the internet’s about gold and freegold in particular. That free gold part got me curious, so it’s a real pleasure to talk to someone who appears to have been there from the beginning of freegold.

But before we start talking freegold, let’s go back to the moment you started. That’s more than forty years ago. That must have been straight at the end of the Bretton Woods system, and what’s triggered your interesting in gold back then?

Koen: Exactly! It was the turbulent Seventees, where we had the oil crsis. And … the closing of the gold window. by president Nixon. And, the debt crisis started escalating at that particular moment up until now. And that was the main reason why gold got my attention, and started to study it. And, to trading it, to buying it, holding it and accumulating it.

Fg: Okay. Which might not be that obvious to people -like me- who have not been in that timeframe. Can you describe that time to the audience? Has it been turbulent in a political sense, from a monetary perspective? Can you describe that to the audience?

Koen: It was a very, very, very turbulent period, on all aspects of life. Politically, socially, economically and financially. The Dollar, the almighty world Dollar came under pressure, simply because Nixon closed the gold window and the Dollar was not redeemable in gold anymore. So, all those who have been accumulating Dollar surpluses as a reserve, they have no right to redeem their Dollars for gold! And that was a unilateral decision taken, by the Dollar regime.

Fg: It was like a shockwave going through the the financial and monetary system?

Koen: Exactly!

Fg: Right. Which is actually quite hard to understand, for like people like me. We have simply seen, and grown-up in a very stable time, with almost no inflation or not visible inflation, and not so much political turbulence. So it was quite a different time back then.

Let’s move to the current day, because we just moved from a liquidity crisis back in 2007 and 2008, into a full blown sovereign debt crisis. Ho would you describe the economic situation we are in right now?

Koen: Well, I can synthesize it in four words: It is a “debt driven, political economy”. So the main driver of this economy is debt! No economy without an escalating debt, upon debt! And the economy is also politically driven! This is not a free market as we all imagine what a free-market exactly is. It is our politics and debt is politics! Economics are politics, politics are economics!

Fg: Right, so the usual phrase that we have a free market, and the free market is failing is, well, not something you would agree with?

Koen: There has actually, there has never been a free market! Doesn’t exist such a thing as a free market. All markets are governed. And politically governed.

Fg: Right. And I think that this quite right and even on a moderate level, there has been market manipulation from basically the beginning of the market places anyway. And how is the current situation different, then back when you started as a gold investor forty years ago?

Koen: In my opinion it escalated from bad, to worse. More politics, more debt, simply because it is a systemic affair. And it is not a cyclic, or an up or down matter, but systemic affair. So, today, we see the results of forty, fifty, sixty years, almost seven decades of mismanagement. More and more political economy. Less free markets, and further and further away from meritocracy principle. And that is also having an effect on our social life. People lose direction. Debt, the debt orgy is completely starting to control the western hemisphere. And we see the results today.

Fg: Right, you bring up a particular word “meritocracy”, and especially related to debt. Because I think what you’re saying is that debt is basically distorting the economic behavior and economic function of our society. Can you elaborate a little bit on meritocracy, how debt is impacted?

Koen: Yes. There is nothing wrong in fact with debt, as long as it is productive debt. But if unproductive debt starts to domino it, the whole economy in the western hemisphere, we see that meritocracy is going down. Just think about subsidies, about particular groups who can exploits the unproductive debt formation for their own profits. The financial industry’s debt grows so big, so enormously astronomical big, that it is completely dominating the physical economy in the entire world. And normally it should be vice versa. You have a healthy economy, a physical economy, and you have a serving financial industry. So, basically we have an upside down world.

Fg: Right.

Koen: Yes.

Fg: OK. Because you mentioned good debt, that also implies there is bad debt. If I were to describe good debt, then I am thinking about for instance: When we had the colonization of the United States, you could provide loans to the new colony. And with that money, the people over there were building farms, and making themselves productive. Creating goods, selling them abroad, and actually paying off their debt. And starting to generate a revenue. I think that this definition of good debt.

Koen: Exactly.

Fg: So, then we are basically being run today by bad debt.

Koen: Yes.

Fg: OK, and if I were to give an example, then I’m thinking about the evarage person taking on a loan to pay off a holiday. And that is of course a complete waste of money because you’re not producing anything with that debt, or with that loan. You are simply destroying the value of it.

Koen: Yes. Yes, and since debt is money and money is debt. And, when unproductive debt is bad, so you have fake money.

Fg: Right. So begin to see the mismatch between our debt driven world, which is our money, and the real economy.

So, moving on, because most people unfamiliar with gold investing, would describe hard core gold investors as “gold bugs”. People who advocate hard money, and who like to return to a gold standard. But you are not one of those people who like to return to a gold standard, but want to return to something else called freegold. Can you describe that to our listeners?

Koen: Yes. The old gold standard was a fixed price, goldprice standard. With emphasis on a “fixed price”. Today, 42 Dollars an ounce. Now, That fixed Dollar gold price standard failed totally. That is why Nixon had to close the gold window. Because, there was too much mismanagement in the financial monetary affairs, that Dollar debt became so astronomical, that no Dollars were redeemable in physical gold any more. So, America just to had to stop exchanging Dollars for physical gold.

End of Transcript Part 1

Please notice the Forum item in the menu too.

History

Freegold was first seen at the ancient times of the Roman Forum and its Greek equivalent. People gathered at the market place for trading, and used scrip money to facilitate transactions. Their scrip money was not intended to be a store of value, and a surplus of scrip money was converted to something more resembling a store of value like gold or silver. Later, and probably due to increased quality and general availability of Coining, base metals and precious metals were used as money, which brought us the gold standard and ended the natural freegold area. A gold standard had severe restrictions on governments to apply monetary policy, especially in deflationary times as occurred in the 1930s. Ever since, the importance of the gold standard has been reduced, first by removing convertibility for US citizens in 1933, later by removing the international dollar to gold convertibility for Nations in 1971, which ended the Bretton Woods system. That left the US dollar as a thought of gold, in the books of the US Treasury still marked at $42 2/9 dollar a Troy ounce, without any convertibility whatsoever. Without this official convertibility though, gold was still monetized, and a rapid increase in the price of gold would signal investors a decline of the value of the US dollar. This forced governments to actively manage the price of gold, documented by the Gold Anti-Trust Action Committee. With massive printing of currencies started after the Bankruptcy of Lehman Brothers in 2008, investors flock to commodities and precious metals, making gold price manipulation difficult to governments and which in effect counteracts monetary policy.

Implications of freegold

Under a freegold system, people are encouraged to save their surplus purchasing power in gold, for future spending. There are some severe implications coming out of this:

• Savings accounts at banks will be found less interesting (as this is an investment, not savings), leaving the banks with a declining pool of capital. Due to leverage function of fractional-reserve banking, it may greatly impact the financial industry.
• People who save their surplus purchasing power in currency and currency derivatives, may see their purchasing power greatly diminished when the monetary system is shifting to freegold, while keeping their savings in currency.
• Monetary policy will no longer impact the pool of savings (the savers).
• Interest rates will truly reflect the anticipated future purchasing power of currency.
• Countries will no longer try to devalue their currency for cheap exports. Quite the contrary: a strong currency will cause an inflow of gold, a weak currency will cause an outlow of gold.
• Freegold will solve the Triffin dilemma, as nations may opt for payment in what they perceive most valuable: currency or gold.
• Freegold may enable meritocracy; those who have (are) the labour force, natural resources or capital (gold) are in power; opposite to today where those who control the money are in power. Therefor;
• Freegold is allowing Third World countries to join the global economy.
• Freegold will put a brake on the debt based money expansion (due to its compound interest), as money is used for short term transactions only. This is more compatible in a world existing of finite resources and sustainable energy.
• Freegold will better support Islamic banking, and Islamic countries might even opt for a gold standard, though leaving them without monetary policy capabilities.

The significance of freegold can only be theorized until its arrival, though it will fundamentally change our perception of money for centuries to come.

Origin of modern day discussions

Late 1997, freegold was first discussed on the internet by someone using the Pseudonym Another. In his forum posts, he described an important but undisclosed relationship between the flow of oil and gold, and a cheap dollar. When Another stopped publishing, someone else continued writing under the Pseudonym FOA (Friend of Another) who published The Gold Trail. Writings have stopped after 2002. After his death in 2005, Ferdinand Lips, co-founder and a managing director of Rothschild Bank AG in Zurich, was identified to be the author of the articles. Lips used the Pseudonym Another and FOA to masquerade his identity. In 2008, an anonymous blogger by the name FOFOA (Friend of a Friend of Another) started raising awareness of freegold again. In 2010, a public effort was completed to collect all the Another and FOA writings, including their comments on other users posts and questions, into one bundle.

The inevitability of freegold

Distribution Freegold June 2011

Starting with issuance of the Euro, the European Central Bank began marking its gold reserves to market value. The more Fiat currencies fall in value against gold, the more obvious it becomes that gold will remain the only store of value – just by reading the balance sheet of the ECB. After the ECB started marking its gold reserves to market, the central banks of upcoming BRIC economies started doing the same. Freegold is expected to emerge, once the (existing or emerging-) reserve currency starts accounting its gold reserves to actual market price.

On 9 May 2002, ECB President Wim Duisenberg said in his Acceptance speech of the International Charlemagne Prize of Aachen for 2002: The euro, probably more than any other currency, represents the mutual confidence at the heart of our community. It is the first currency that has not only severed its link to gold, but also its link to the nation-state. As it may have seem cryptic at the time, Wim Duisenberg describes the Euro as a transactional currency, coexisting with freegold.

Controversy and lacking sources

The concept freegold is sometimes found hard to understand, especially to Western Cultures, who mostly have grown up in a world without a practiced gold standard, and an on average mild inflation. Asian people however do have better understanding, due to a more cultural suspicion against government and (their management of) fiat currency. It is interesting to note that the term or concept freegold is not broadly found on the internet or in publications. Even though the ECB and the central banks of the BRIC countries do support freegold. In order to allow transparent coexistence of freegold, European countries were encouraged to drop VAT on gold, when the predecessor of the Euro , the ECU was introduced. The lack of sources may be explained as a surreptitious act of the creators of the new competing currency-block to the dollar, who didn’t want to outright threaten the Dollar hegemony. Implications (for the Status quo) have been found severe, as described by John Perkins in his book Confessions of an Economic Hit Man.

A US specific implementation Methodology has been suggested by Jim Sinclair, who used the name Revitalized and Modernized Federal Reserve Gold Certificate Ratio.
Robert Zoellick, president of the World Bank, suggested the name Gold Reference Point for this concept.
Martin A. Armstrong, former chairman of Princeton Economics International, Ltd., suggests a new world currency is linked floating to gold.
Freegold has been discussed at the Austrian School of Economics

This blog will track all available You Tube video’s as well as Seminar’s on Freegold.